Singapore (Platts) -- South Korean trader E1 Corp has bought 44,000 mt of LPG from Iran's Petrochemical Commercial Co., possibly the first spot cargo from the Middle Eastern producer to come to Asia this year, after an EU ban on propane and butane trade from Iran brought its exports to a near halt since late last year, market sources said.

The cargo comprising 33,000 mt of refrigerated propane and 11,000 mt butane was purchased via a spot tender by E1 for loading over May 15-25, and will be shipped by PCC on a CFR basis, a source familiar with the matter told Platts.

The company could not be reached for immediate comment.

Other traders said the tender was awarded at a premium in the high $40s/mt to the Saudi June Contract Prices for propane and butane, CFR basis, and was likely to be shipped to South Korea, as the Iran cargo could not be used for trading.

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Traders said that this is the first tender issued and awarded by PCC since September last year, which was heard to have also been won by E1.

The emergence of an Iranian cargo had triggered a reversal since last Thursday of a minor recovery of prices in Asia, which had seen an absence of cargoes being offered from other Middle Eastern producers such as Saudi Aramco and Qatar's Tasweeq in recent weeks.

"I gather Iranian tons reappearing on the market seems to have been the catalyst to Eastern selling," one market source said, adding that E1 featured as sellers of Contract Price swaps over the last last few days.

In its "frequently asked questions" document issued late January, the International Group of P&I Clubs, an association of major marine insurance providers, clarified that propane and butane are included under the EU ban on natural gas trade from Iran.

The grouping was also informed by the European Commission and UK authorities that the ban applies to all destinations for the gas.

Shippers said that the latest CFR shipment by PCC might indicate that some ship owners are willing to deliver Iranian cargoes to Tehran's LPG customers.

Since the EU sanctions first came into effect last July banning the provision of insurance for oil tankers by EU-based insurance and reinsurance companies for moving Iranian oil cargoes, Tehran has been using its own vessels or time-chartered ships to export crude and fuel oil.

The tankers owned or time-chartered by Iran have been provided with protection and indemnity cover offered by Iranian insurance companies.

It has also been widely heard in the market that the tanker companies floated by the Iranians in Dubai have been scouting to buy LPG tankers, or take them on time-charter basis for delivering LPG cargoes to Tehran's customers.

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